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What is the variance of the returns on a portfolio comprised of $4,200 of Stock G...

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Question

Finance

What is the variance of the returns on a portfolio comprised of$4,200 of Stock G and $5,300 of Stock H?

State of

Economy

Probability of

State of Economy

Rate of Return

if State Occurs

Stock G

Stock H

Boom

.18

.18

.08

Normal

.82

.14

.11

.001324

.000000

.000209

.000248

please show work

Answer & Explanation Solved by verified expert
3.6 Ratings (627 Votes)
Total Portfolio P value Value of Stock G Value of Stock H 42005300 9500 Weight of Stock G Value of Stock GTotal Portfolio P Value 42009500 04421 Weight of Stock H Value of Stock HTotal Portfolio P Value 53009500 05579 Stock G Scenario    See Answer
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Transcribed Image Text

What is the variance of the returns on a portfolio comprised of$4,200 of Stock G and $5,300 of Stock H?State ofEconomyProbability ofState of EconomyRate of Returnif State OccursStock GStock HBoom.18.18.08Normal.82.14.11.001324.000000.000209.000248please show work

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